Renewables: Beyond Traditional Small Scale Applications

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When people think about renewable energy for their homes and businesses, the first option that comes to mind is building a traditional solar panel array. Whether on their roof or on the ground, these systems provide clean solar energy and are eligible for different incentive programs. Nevertheless, that is not the only option available. In an industry that has seen rapid innovation and an overall drop in prices, companies have been quick in exploiting more ways in which to create value. This post, the first in a 2-part series, will explore new innovations in solar canopies, roofs, and even shingles.

Some excellent examples of this trend are solar canopies and roofs. The best way to picture the difference between these technologies and a traditional system is in the capabilities they add and how they are used.

Solar Canopy

The main difference between a traditional system and a canopy is the possibility of using the space beneath the solar array for purposes other than energy generation. Mostly built as shade for exterior or open spaces (parking lots, terraces, patios, etc.), a solar canopy can typically produce the same amount of energy as a traditional fixed system. Lacking impermeability, solar canopies are mostly used where water damage is not an issue.

Solar Canopy

Solar Roof

While a solar canopy provides shade, a solar roof goes one step further, and provides protection from water damage, becoming a standalone roof system that can create a rainproof closed space. Not to be confused with solar panels placed on an existing roof surface or solar shingles, a solar roof dispenses from the roof surface and mounting system entirely and allows for the solar panel to act as the roof itself. Warehouses, greenhouses, barns, and sheds are some of the successful applications of this technology. Frequently, construction costs limit energy production.

Solar Roof – Lindes Glass Factory

Solar Shingles

Recently, a new market segment that has gained traction, with investments from high-profile companies such as Tesla, is the solar shingle market. This technology’s value-add is the possibility of interchanging traditional roof shingles with solar energy generating alternatives. A less intrusive and more aesthetically pleasing technology compared to the traditional On-Roof system, solar shingles represent a good alternative for retrofitting existing structures. Because of their nature as shingles, a disadvantage to this technology is the high variability in production due to roof shape and shadows.

Solar Shingles

Since the intrinsic value of a solar canopy or roof lies on the possibility of giving the same space additional uses without too much compromise in energy generation, these solutions are better applicable to new projects. A project’s design should create the most value for its owner, whether by optimizing energy generation or space usability. When energy generation is prioritized, the system may result in steeper slopes due to optimal orientation (which can lead to higher construction costs). When the space created or project cost is prioritized, slopes will be smaller, losing optimal panel orientation (which may result in lower energy generation).

The additional space usability provided by these technologies make them an interesting alternative to traditional installations. As mentioned before, solar canopies and roofs enjoy similar economic incentives (Federal and State) to traditional systems. North Carolina has Property Tax Exemption incentives of either 80% or 100% (Source 1 and 2) (business and non-business uses respectively), as well as a federal 30% tax credit for solar photovoltaic installations. By adding an additional use to the same space, you can stretch those incentives into much more than just power generation. For example, when building a new garage with a solar roof, property values would go up, without an equal increase in property taxes.

As the renewable energy industry keeps innovating, new products and solutions that solve an ever-increasing number of problems will continue to be developed. Great examples of this trend are solar canopies, roofs, and shingles. Today, it is possible to move away from traditional on-roof and on-ground systems into broader solutions that provide additional benefits such as usable space.

Diego Garza is a first-year MBA student at Duke University, The Fuqua School of Business and a Community Revitalization Fellow at the Development Finance Initiative.